31 July 2019
Umair Khalil (Monash)—On the Horns of a Dilemma?
This week on the blog, Tim Hatton and Aditya Balasubramanian (ANU) reflect on the recent ‘Progress and Change in India’ workshop, hosted by the ANU’s Centre for Economic History.
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Now, to the post…
ANU’s Centre for Economic History hosted a conference titled ‘Progress and Change in India’ from 11-12 July, 2019, bringing together leading historians and development economists. James Fenske (Warwick) opened the proceedings with a very long run perspective, which focused on the persistent effects of conflicts between the myriad of states in precolonial India. These wars created a legacy of increased state capacity and infrastructure building that is still evident in local development as measured by night-time luminosity.
Chinmay Tumbe (Indian Institute of Management) showed that urbanisation in post-independence India was service-based and it was relatively slow, partly because birth rates were lower in urban than in rural areas. That raised the question of why rural-urban migration was not as large as might have been expected, which led to discussion of a range of potential constraints on mobility. Manoj Pandey (ANU) charted the decline in the poverty rates from more than 50 percent in the post-independence decades to less than 30 percent in 2000. But progress varied widely between states, depending on initial poverty rates and on the fortunes of different economic sectors
Sabyasachi Das (Ashoka) noted that female participation in political leadership matters for a range of socioeconomic outcomes but that this is conditioned by pre-existing gender norms. He found that in more gender biased districts women were more likely to vote for female candidates and so the emergence of female politicians need not be constrained by slowly changing gender norms. Education is a key to advancement and Priya Mukherjee (William and Mary) used an experiment with a provider to investigate the price sensitivity of after school private tutoring. She found that demand for enrolment was downward sloping but, ironically, participation had little effect on test scores.
The contribution of railways to economic growth is a long-standing debate in economic history but in India the effect seems to have been smaller than elsewhere. Dan Bogart (UC Irvine) disaggregated the social savings in freight transport by district and commodity, emphasising the concentration on minerals for export with limited linkages to other sectors. Shifting to modern times, the focus has been on improving roads that connect rural communities to the wider economy and Sam Asher (World Bank) compared villages that were provided with paved roads with those that were not. The former experienced little direct increase in economic activity within the village but paved roads did increase the residents’ access to education and employment in urban centres.
The keynote address (doubling as the F H Gruen Public Lecture) was given by Bishupriya Gupta (Warwick) who provided a compelling analysis of the long sweep of Indian history from pre-colonial times to the present. She used economic statistics from recent research to debunk a range of popular myths. The negative effect of deindustrialisation on growth during the colonial era (a prominent claim) could only have been marginal in an overwhelmingly agricultural economy. And while growth in the early post-independence decades may have been slow relative to the Asia Tigers (an oft-cited comparison), it was a significant improvement on India’s past. The negative legacies of colonialism included lack of irrigation in agriculture and poor basic education, but on the positive side, strong tertiary education supported growth in the hi-tech service sector.
The second day of the conference was opened by Yusuf Neggers (Michigan) who reported on an experiment to improve bureaucratic efficiency in the allocation of funds under the work employment guarantee scheme (MGNREGA). Providing a mobile phone app to different levels of management reduced payment delays, especially when given to middle management. Gaurav Khanna (UC San Diego) examined the political fallout for the ruling BJP from the infamous withdrawal of high denomination banknotes in November 2016. In state elections the BJP were punished in under-banked districts but were rewarded in districts with higher bank density. Aditya Balasubramanian (ANU) followed with an analysis of the economic thought of Deendayal Upadhyaya (1916-1968) who has become an icon of the BJP. His economic ideas focused on decentralisation, promoting small scale industry and farming, and national self-sufficiency, which, while appealing to some constituencies, only partially align with the current policies of the BJP.
The afternoon session began with two presentations on the effect of gender laws. Eddy Tam (Oxford) examined the effect of the 1929 act that raised the minimum age of marriage for girls to 14 only in the areas of direct British rule and not in the princely states. The initial effect was to raise marriages among 10-15 year-olds in anticipation of the law but the long run effects of lower child marriage and higher educational enrolment among females persisted in former direct rule districts to the end of the century. Lakshmi Iyer (Notre Dame) reported that earlier work had shown that the election of women to local councils was associated with reduced crime rates, especially for crimes against women. Exploiting changes in the quotas for women legislators she found that more (as distinct from any) women legislators produced no additional reduction in crime.
Pushkar Maitra (Monash) investigated the effects of delegating the delivery of agricultural credit to local intermediaries who were recommended by private agents as compared with those recommended by government agents. Those recommended by private agents allocated resources to more productive farms but their greater success was largely due to closer engagement between the agent and farmer. Last but not least, Umair Khalil (Monash) asked whether chief ministers in office from 1992 to 2008 used their positions to enhance prosperity in their own constituencies. The evidence from luminosity suggests that they did, but only during their tenure in office and only if the district they represented was not their birth district.
This was an important conference within the context of economic history in Australia and New Zealand because it integrated interests in history and development. Furthermore, the geographic focus on India was unusual, as most prior conferences have tended to be about specific issues rather than countries.
–Tim Hatton, with inputs from Aditya Balasubramanian
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